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The stock of Nelco has surged 10.6 per cent with above average volume, taking support in the band between ₹76 and ₹80 on Wednesday.
This rally gives traders with a short-term perspective an opportunity to buy the stock at current levels. It has decisively surpassed the 21- and 50-day moving averages. Since last April, the stock is in an intermediate-term uptrend. The relative strength index on the daily chart is moving towards the bullish zone in the neutral region and the weekly RSI is also following the same. Both the daily and weekly price rate of change indicators have entered the positive territory from the negative territory implying buying interest.
The short-term outlook is bullish and this bullish momentum has the potential to take the stock higher to the key resistance level of ₹93. Targets are ₹91.5 and ₹93. Traders can buy the stock with a stop-loss at ₹85.5.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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